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The Middle East has long been hostile to Christians and other religious minorities. Among those at risk are Egypt’s Copts.

During the reign of dictator Hosni Mubarak, the U.S. State Department called the status of Egyptian religious liberty “poor” and noted that Christians and Baha’is faced “personal and collective discrimination.” Attacks on Copts were common, and perpetrators rarely were prosecuted.

Mubarak’s overthrow led Copts to hope for a freer and safer Egypt. But under Mubarak’s successor, President Mohamed Morsi, violence against Copts increased. Morsi was not the only culprit. In one infamous case, the military–then headed by Gen. Abdel Fattah al-Sisi–shot down more than a score of Coptic protesters.

Two years ago, al-Sisi overthrew Morsi and eventually became president. Alas, the military used extreme brutality—killing hundreds of demonstrators on the streets of Cairo—to maintain control.

Coptic Pope Tawadros II publicly supported the coup. But the church remained as vulnerable as it was visible, and was targeted by angry Islamists. Dozens of churches were destroyed.

U.S. leaders routinely emphasize that America’s foreign policy is based on support for the expansion of freedom around the world. But as I point out in a recent article in the National Interest Online, Washington’s behavior frequently does not match the idealistic rhetoric. Too often, U.S. policymakers seem to favor even brutal and corrupt authoritarian allies over boisterous, unpredictable democratic regimes.

During the Cold War, U.S. administrations enthusiastically embraced “friendly” autocratic governments in such places as South Korea and the Philippines—even when there were viable democratic alternatives. Because it was uncertain whether democratic governments would be as cooperative with U.S. foreign policy aims, officials preferred dealing with more compliant autocrats. Worse, U.S. leaders repeatedly misrepresented such allies to the American people as noble members of the “free world.”

The tendency was especially pronounced in the Middle East, and that cynical policy has persisted longer there than in other regions. It began early, as the U.S. Central Intelligence Agency helped overthrow Iran’s elected prime minister, Mohammed Mossadegh, in 1953 and restore the Shah to power as an unconstrained monarch. The Shah became America’s chosen Persian Gulf gendarme for the next quarter century, despite the regime’s appalling human rights record and pervasive corruption. Elsewhere in the region, Washington developed a cozy relationship with Egyptian leader Hosni Mubarak that lasted three decades, even as he and his military cronies looted and brutalized that unhappy country.

Unfortunately, the Obama administration seems just as hypocritical as its predecessors when it comes to relations with Egypt and other Middle East countries. U.S. leaders were reluctant to cut Mubarak loose even as pro-democracy demonstrations surged throughout Egypt in 2011. In a PBS interview, Vice President Joe Biden even objected to describing Mubarak as a dictator and rejected calls for him to step down.

CAIRO—“I could be arrested when I leave here,” said a journalist who I met at the tiny Marriott near Cairo’s Tahir Square. A student activist observed that he could be detained at any time.

A veteran human rights activist calmly stated: “Some of our groups will be closed. Some of us will be imprisoned. It is inevitable.”

Most foreigners travel to Egypt to play tourist. I visited with a human rights delegation, reminding me yet again about how lucky Americans—and, indeed, most Westerners—are.

Most important are the basic characteristics of a free society. The rule of law. Civil liberties. Criminal procedures. Legal safeguards. Democratic processes.

Obviously, even nations which purport to have all of these often fall short. However, few Americans or Europeans, or citizens of democratic Asian nations live in constant fear of arrest, imprisonment, and torture.

In Egypt the uncertainty began when arriving. On both of my trips the government knew our delegation was coming. Both times I was pulled aside.

On the first trip an entry guard took my passport and I waited for an hour before officials returned it and waved me on. The second time after far shorter delay security officials formally welcomed me—after asking for my phone number and hotel destination.

Of course, the U.S. occasionally stops people from entering, but not typically because they want to assess America’s human rights record. Even after leaving the arrivals area on my first trip I had to wait again while the videographer joining us unsuccessfully attempted to persuade officials to let him bring in his camera.

Both visits were filled with interviews—relating all sorts of harrowing stories. Most every society has injustice and errors are sadly common in U.S. jurisprudence. However, most Americans don’t expect a visit to a friend to turn into a stint in prison.

In Egypt for reasons of political repression and personal revenge people face arbitrary arrest, perpetual detention, fraudulent trials, and horrific imprisonment. Some of the accounts we heard could be exaggerated or even false, but reports from people in many walks of life and across the political spectrum suggested that the slightest resistance to state authority risks freedom and even life.

Is Egypt’s economy taking a turn for the better? The government is hosting an economic summit in February next year, aiming to attract foreign investment, with the participation of not just private investors but also of the International Monetary Fund.

[Christine] Lagarde said Egyptian authorities’ “recent reform efforts” were “encouraging” and expressed her hope that participants in the upcoming summit will see how these reforms can “help restore durable economic stability and sustainable growth to Egypt.”

On the surface, it appears that Egypt’s government is making tangible progress addressing the country’s fiscal problem. The planned energy subsidies cuts are under way, although these are also accompanied by tax increases, mainly through a planned introduction of a value-added tax, hikes to tobacco and alcohol taxes and a new tax on capital earnings.

Experience from other countries, most notably from Europe in the aftermath of the global financial crisis, shows that fiscal consolidations that rely on revenue increases lead to worse outcomes than consolidations that consist of permanent reductions to government spending.

But, whatever one thinks about this particular question, there are two additional reasons to be skeptical. First, putting aside the fuel price hikes that have already occurred, much of the praise directed at the Egyptian government presupposes that it will deliver on its promise to slash subsidies by one third in the fiscal year 2014/2015. That would be welcome news but it is worth remembering that similar reform targets were set in the past and were systematically missed:

According to the budget for the past fiscal year, 2013–2014, the subsidies to oil materials were already supposed to be close to EGP100bn ($14bn). Yet, the actual spending was drastically higher, perhaps by as much as an additional EGP70bn ($10bn)

Second, it is deceptive to look at the fiscal question in isolation, as a technocratic problem that can be solved by clever tweaks to existing policies. Egypt’s economic problem is political in nature, and will continue to plague the country as long it is governed by a kleptocratic, unaccountable elite.

The government – more specifically its military forces – own and run a large part of the economy, shielded from competition, and generating rents. The military coup last year led to the strengthening of the opaque network of cronyism that has long characterized military-run enterprises. Some estimates suggest that as much as half of last year’s stimulus, worth around $4bn and funded predominantly by funds from the United Arab Emirates, has been directed at military-controlled enterprises that became involved in road construction and other forms of infrastructure works, displacing the traditional construction companies.

Just as it was a mistake to see Vladimir Putin as a market reformer in the early 2000s, notwithstanding some of the real policy shifts (such as the introduction of a flat tax), it would be a mistake to see President Abdel Fattah el-Sisi as somebody aiming to open Egypt’s economy to competition and raise the living standards of Egyptians through increased economic freedom. If economic reforms occur, they will occur with the narrow goal of strengthening his hold on power and satisfying the material needs of the generals backing him.

In Egypt, as in other countries of the region, economic and political oppression go hand in hand and are mutually reinforcing. Nothing is a bigger threat to a military dictatorship than an economically empowered citizenry. For this reason, we should not expect genuine reforms to be very high on Mr. el-Sisi’s list of priorities.

Countries of the Arab Spring suffer from many economic, social, and political ills. At their center lies the unfortunate legacy of Arab Socialism, which established itself in the region during the 1950s and 1960s. One of its features, besides the ideology of Pan-Arabism and international ‘non-alignment,’ was an emphasis on government ownership and industrial planning. Far from generating prosperity and economic growth, these policies resulted in large, vastly inefficient government-operated sectors in several Arab economies. My new Cato Policy Analysis provides a sense of the magnitude of the problem and of its evolution over time:

In Egypt, for example, the share of government investment fell from around 85 percent in the late 1990s to below 40 percent in 2012. Over the same period of time, the share of government investment in Algeria doubled, from around 30 percent to above 60 percent. Throughout much of the same period, the average for lower-middle-income countries hovered under 30 percent.

Some Arab governments, most prominently Hosni Mubarak’s regime in Egypt, attempted to put in place large-scale privatization programs. However, these were perceived (and rightly so!) as attempts by the political elites and their cronies to simply seize publicly owned assets, without much regard for the future restructuring of the companies and their exposure to competition. My paper reviews the experience of privatization in other countries and tries to provide some practical lessons to policymakers in countries such as Egypt or Algeria.

First and foremost, privatization needs to be perceived as fair and transparent. Bidding should be competitive and open to a large spectrum of potential bidders, domestic and foreign. Second, private ownership of the financial sector is a requisite for successful privatization and restructuring of the rest of the economy–otherwise Arab countries risk creating a dangerous nexus of cronyism through which the state-owned banks and financial institutions would provide funding to newly privatized companies. Third, in order to avoid the danger of simply replacing government-run monopolies with privately-run ones, privatization should be far-reaching and accompanied by broad economic liberalization and opening up both to trade and investment.

Privatization is not very high on the agenda of Arab policymakers or foreign experts, and is typically eclipsed by the more immediate political concerns about the region. It is not, however, an issue that can be simply ignored.

It is a mistake to think that economic reforms can wait until Middle Eastern countries address their internal political and economic problems. There are not many examples of countries that have transitioned successfully to a representative constitutional government while maintaining economic rules that deny opportunity to large segments of the population. State ownership, accompanied by regulations that favor existing state-owned incumbents, are a critical part of the problem facing countries in the MENA region, most notably Egypt, Libya, Algeria, Syria, and Yemen

Egypt’s government spends more on subsidies of consumer products—most prominently energy and food—than on health and education combined. Subsidies distort markets, lead to waste, and are largely ineffective in helping Egypt’s poor. Therefore, it should be heartening to see the government tackling the problem, as part of its effort to bring down the country’s fiscal deficit.

According to Finance Minister Hany Kadri Dimian, in the new fiscal year 2014–2015, “[T]he allocation for fuel subsidies has been cut from around EGP144bn ($20bn) last year to EGP100bn in the new budget.”

On the surface, that appears to be a bold step, slashing spending on fuel subsidies—which are by far the biggest fraction of the total subsidy bill—by almost a third. But there is a catch. According to the budget for the past fiscal year, 2013–2014, the subsidies to oil materials were already supposed to be close to EGP100bn ($14bn). Yet, the actual spending was drastically higher, perhaps by as much as an additional EGP70bn ($10bn)

And, similarly, in the preceding fiscal year, 2012–2013, the budget for fuel subsidies was to be EGP70bn, in what was seen at the time as an attempt to bring spending under control, especially relative to the previous fiscal year. But again, the actual spending on fuel subsidies during the year was drastically higher. Some of the Finance Ministry’s revised estimates were at EGP100bn, while others claimed the real numbers were even more sizeable.

In short, in recent years the government of Egypt systematically—and quite substantially—underestimated the planned spending on fuel subsidies. One can blame that on many factors, most prominently on the political turmoil, but this track record gives little guarantee that this time will be different.

Although the awareness of the problem, as well as the wider use of smart cards to allocate subsidies, are both encouraging, one needs to keep in mind that the most recent announcement is a far cry from a genuine reform plan. Even if actual spending on subsidies were exactly equal to the amount allocated in the budget, in nominal terms that would only bring Egypt back to the spending levels of fiscal 2011–2012, which were already unsustainable. As I argued in an earlier paper, what Egypt needs is a plan to phase out fuel subsidies altogether and replace them with targeted cash transfers. Alas, such a plan is nowhere in sight.

Following the decision upholding numerous death penalties for Muslim Brotherhood members accused of a 2013 attack on a police station, Egypt has recently seen the conclusion of another sham trial, resulting in harsh sentences for three al-Jazeera journalists, accused of aiding terrorists.

While it is obvious that trials like these move Egypt further away from freedom, could they also be inadvertently helping Islamic radicals? My new development bulletin argues that political repression of the kind we are seeing in Egypt creates incentives for Islamists to use violence in order to attain their goals.

Iraq, where ISIS is making continual progress fighting the government of Nouri al-Maliki, is an extreme example of where things can end when political elites exclude a significant part of the population from democratic politics. Al-Maliki’s premiership has been marked by a strengthening of his own hold to power, progressively alienating the country’s Sunni population.

My paper argues that the electoral successes of Islamists in Arab Spring countries have relatively little to do with religion but rather with the organizational characteristics of Islamic political groups, which were typically active in the provision of local public goods and social services. Instead of seeing the rise of Islamic political organizations as a pathology that needs to be countered – possibly through repressive means – we should note that,

[I]n transitional environments, the electoral success of Islamists is a natural result of the political environment, which can be mitigated only by an increase in the credibility of alternative political groups. The electoral advantage enjoyed by Islamic parties can be expected to dissipate over time as competing political groups establish channels of communication, promise verification for their voters, and build reputation over time.

There is no denying that religion and politics do not always mix well. However, the appropriate answer to the ugly side of religious politics is not political repression of the kind we are seeing in Egypt but rather open, competitive democratic politics.